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MODERN LAWYERSFOR CHANGING TIMES 'a City firm in a non-City location' - Legal 500

MAR
14

Jurisdiction and Post-Brexit Britain

brexit 1Several EU initiatives have harmonised the cross-border litigation rules applicable across the European Union. But what will happen to these rules post-Brexit? And how will the UK adapt its own rules to meet a post-Brexit Britain?

Read the Article here.

 By Annabelle Pantling.

 

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NOV
11

The Property Update; November Newsletter

black and white housesThe Lewis Nedas Property Newsletter is back!

We took a break over the Summer and the early Autumn, to assess the ramifications of the Brexit vote and its effect on the Housing Market. It is still far too early to say what the true effects are, because there have been so many other variables to consider (the drop in the pound being one such major variable). It's accurate to say that the market is much quieter and price growth is much reduced.

The London prime markets, i.e. Zones 1 and 2, have however seen a marked reduction in prices, a record average drop of over £100,000!

Fewer people are able to buy property; in fact the number of under 35’s who are property owners has decreased by 1/3 since 2011, to 334,000 this year. The U.K is now outside Europe’s top 20 countries for house sales.

 

Buy to Let Market

It's plain that there are issues on the horizon for buy to let investors; they will see less tax relief and less mortgage availability the supply of housing is on a rising curve and rents are increasingly unaffordable.

Additionally those BTL landlords who used a supposed loophole, which appeared to allow landlords (before the increase in SDLT in April this year) to transfer properties into limited companies in an attempt to avoid the increase in tax, are likely to come to the attention of HMRC.

Such a device is likely to fall foul of HMRC and tax avoidance legislation, and could easily attract allegations of both tax and mortgage fraud. It is anticipated that HMRC would assume that such transfers to limited companies were artificial structures.

 

Residential Property

We have seen the usual contradictory reports about the market - the NAEA (National Association of Estate Agents) report that confidence in the housing market is back to pre- Brexit levels and an increase in demand in September 2016, though in the same month mortgage approvals were markedly reduced (by 15%) when compared with September 2015.

There was also a slight dip in the number of residential properties coming onto the market, again when compared with last year.

Sales of homes are now taking longer than in 2015, in fact they are taking an additional month longer and it can take 91 days to secure a sale.

John Lewis report that new build / newly converted properties in this country are now the smallest properties in Europe, and are on average 92% of the recommended size.

Property Partners latest research suggests that it would take the average Londoner on an average salary of £34,000 faces a period of 121 years before they could afford to save the average necessary deposit to buy a property in London, if they are unable to rely upon the bank of Mum and Dad.

The drastic fall in the value of the pound has attracted increased foreign interest in the London market, but the canny US/Chinese/Middle Eastern potential purchasers would appear to be hanging back to see if any further falls in the pounds value would benefit them more.

Certainly they would also seem to be casting their nets wider than the prime London zones 1 and 2.

Those areas likely to be affected (or benefited by) Crossrail and HS2 are also of increasing interest, in particular to shrewd Chinese investors.

Additionally we have noticed that foreign investors have computed that because of the increased SDLT, it makes more economic sense to buy a number of smaller flats in areas such as Colindale and Hendon, rather than pay the same amount of SDLT upon the sale of one larger property.

Our specialist property lawyers have also dealt with a large increase in clients seeking advice about potential compensation as a result of HS2 expansion - Our very own Richard Greenby (rgreenby@lewisnedas.co.uk) is the lawyer to contact in that issue.

This brings us neatly to the issue of the Third Heathrow Runway expansion, recently given the official go ahead by government.

According to reports this is likely to depreciate the value of properties in the area by 20%, some 783 homes are expected to be demolished. It is said, that government are prepared to pay a purchase price of 125% of the value of the property together with stamp duty and related fees, the likely cost of which is rumoured to be in the sum of £1.5bn.

It is also said to offer a potential boost to the construction industry to the tune of £18bn.

 

Commercial Property

Again this sector is experiencing some major changes, a great many investors have removed themselves from this market.

The 'gig' economy is also have a huge effect on the market, Young flexible companies do not wish to tie themselves up with lengthy commercial leases of 20 years, instead the average lease is now about 7 years and likely to reduce further.

Business centres that offer office facilities are increasingly in demand and are proving to be a lucrative investment.

 

Equity Release

This sector is still booming away and has increased by 1/3 over the last 12 months.

An interesting demographic change in the type of Equity Release applicants has revealed increasing demand not just those from the lower socio- economic demographic but also those who on paper would certainly appear to be wealthier (with properties worth £1 million plus) but who have reduced incomes.

 

If you require an advice / assistance with any of the above issues, please contact our specialist and highly skilled property lawyers on 020 7387 2032 or use our enquiry facility on www.lewisnedas.co.uk

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JUL
28

The Property Update; July Newsletter

london skylineWhether you voted to leave or remain, it's true to say that both the residential and commercial property markets have felt the effect of the ‘leave’ vote.

It's still too early to identify the underlying effects, but our specialist property lawyers noted that almost immediately some purchasers indulged in 'gazundering'. One purchaser, a banker, decided to reduce his offer on the date of exchange (which fell on the day after the referendum) by 25 percent, an offer which was abruptly rebuffed by our client, the vendor, and the sale fell through. However, the majority of all our property transactions completed normally during this period because our clients kept cool heads.

Our multi-lingual lawyers have stated that thanks to the pound being at its lowest level for over 30 years and record low mortgage deals on offer, that there has been renewed interest from foreign investors from the USA, Italy, France, China, South East Asia, Qatar and UAE, and they have dealt with a large number of such enquiries.

 

First Time Buyers

There has been a surge in First Time Buyers during the first two quarters of 2016, i.e. pre-Brexit. According to the Halifax, an estimated 154,200 stepped onto the property ladder for the first time.

The average age of such a buyer has now increased to 33 years old and is very likely to have been assisted by the Bank of Mum, Dad and Grandparents, who will lend/give an estimated £5billion to their offspring this year.

It seems that there is also a marked increase in the numbers of couples buying for the first time. Most of these types of buyers are buying well under the stamp duty limit, especially those buying outside London and the South East. There has also been a growing trend for young purchasers to purchase a 'buy to let’ property initially, with the intention of selling on in order to buy their first residential property. These individuals should take immediate advice, because they may find themselves facing a 3% Stamp Duty surcharge when selling that original property.

Additionally, those parents who own the properties that they live in but have added their names to their off springs mortgage may also find themselves in the same predicament - take advice now should you be in that situation.

 

Is this a good time to buy?

There are some stunning mortgage deals on the market at the moment; in fact, mortgages are at their lowest level to date. With the prospect of a Bank of England cut in August, lenders are looking to increase the volume of their mortgage sales.

So for a buy or re-mortgage from this prospective, it seems the answer is yes.

Additionally Santander, working with Legal & General (and equity release specialist Key Retirement) has just launched a lifetime mortgage, an acknowledgement that the days when a buyer could expect to pay off his or her mortgage within 25 years have now gone.

Certainly there has been a correction in price levels at the very top end of the London market, (this has been happening since 2014), RightMove in its July report state that post Brexit there has been a reduction of .9% (a UK average of £2,647) in prices of those properties coming onto the market in July. With the enormous uncertainty following Brexit that trend is likely to continue.

It has also been reported to our property lawyers that developers selling on 'off plan’ properties are reducing their prices markedly and this has attracted a great deal of interest from foreign investors. One word of advice; don't buy in the larger of developments of smaller flats where there are likely to be any number coming onto the market. There has been a definite slow down in the London new build market so there could be some great bargains there.

 

Downsizing?

Senior and mature property owners have recently been warned by Government not to look to their home as an additional source of income to fund their retirement, in fact it was described as a 'very risky strategy'. Once would be 'downsizers' have done their figures, it's likely that it will not be such a lucrative move.

There is also a huge demand for bungalows, which now command an average 16% premium. These properties are now rarely built by developers, older bungalows have traditionally been built in large plots with big gardens and there is often the potential to build on top of the original property, so they are an attractive proposition for older buyers and developers alike.

A third of equity release customers over 55 years of age still have mortgages and a large number of these have interest only mortgages.

 

Commercial Property

British Land have stated that post Brexit they expect that both tenants and investors will be very cautious.

This is against a background in which investment in commercial property has slumped over the last two years in any event. It is accurate to say that there has been a decline in commercial property prices, and of course there was enormous publicity following several property funds stopping withdrawals by their investors when facing the prospect of an avalanche of redemptions. However, there is evidence that SME’s (small medium enterprises) are bucking that trend.

The technological, media and creative industries in London have been the fastest growing sectors over the last 5 years. These (often young companies) want flexible working space - in admittedly cheaper areas -following the latest trends in 'agile’ working (hot design / working remotely etc.) The business life cycles of these SME are much shorter than traditional companies, so business owners are unwilling to commit to long leases any more. These tenants are more demanding and it pays commercial landlords to engage regularly with these tenants, rather than wait to for lease renewal dates.

 

If you require assistance with any prospective purchase or sale of any type of property in England and Wales, please contact our experienced specialist property (Real Estate) lawyers on 0207 387 2032 or use our online enquiry facilities at www.lewisnedas.co.uk

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JUL
06

London Property Market - A Real Opportunity for European Buyers

housing squareThe majority decision of the British electorate on 23 June 2016 to leave the European Union heralds a new dawn in the property market.

The uncertainty created by ‘Brexit’ has created new pricing opportunities for buyers who may otherwise have been unable to afford their first property purchase and encouraged overseas buyers, attracted by the cheaper pound, to purchase an array of properties at the higher end of the market.

Moreover, those clients who are selling their main residence and buying a new one, are now exercising greater flexibility in their pricing strategy. By accepting in some cases a lower price on their sale and successfully negotiating a larger discount on their related purchase.

The British Government as well as the Bank of England have also issued important and decisive policy announcements to embolden the country’s economy in today’s new era. Macro-economic policy changes include the Chancellor’s recent statement that he intends to lower the rate of Corporation Tax to under 15%. Mark Carney, the Governor of the Bank of England, has also stated that the Bank will step up its monetary measures to increase overall levels of confidence in the nation’s economy. Parts of the British press also believe that Mr Carney has already signalled his intention to lower in the near future, perhaps by this August, the benchmark rate of interest from 0.5% to 0.25%.

At Lewis Nedas Law, we as a team of property professionals are geared up for this new frontier in transactions- as we offer a Partner led group of conveyancers who can act quickly to achieve your objectives.

We also act for overseas clients from a range of countries including France, Spain, Italy and beyond- who require a more hands-on approach and greater level of advice during the course of their transactions.

To our prospective French speaking clients, we say: Nous vous invitons à considérer notre cabinet d'avocats. Nous offrons un service amical et un prix compétitif.

To our prospective Italian clients, we say: Vi invitiamo a prendere in considerazione il nostro studio legale. Offriamo un servizio amichevole e prezzi competitivi.

To our prospective Spanish clients, we say: Damos la bienvenida a considerar nuestro bufete de abogados. Ofrecemos un servicio amable y un precio competitivo.

And to one and all, we say: Welcome to Lewis Nedas, where we offer a friendly and competetively priced service on a range of property transactions.

 

If you are about to embark on a property transaction, please call Richard Greenby, Senior Associate  in our Property Dept on 0207 691 4560 for a free quote, or complete our online enquiry form here.

 

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JUN
16

Property Market Awaits the June Brexit Referendum

brexit 1After having successfully survived the frenzied madness of March 2016, during which our property lawyers were overseeing up to 16 completions a day because of a rush to beat the March 31st Stamp Duty Land Tax increase deadline, the property market is now quieter.

Most potential buyers and sellers anxiously await the outcome of the Brexit referendum on June 23rd 2016. Other factors suggest that perhaps we have reached the top of the 12 year increase in property prices and the market, especially in London and the South East, is heading for a correction.

Statistics published in April 2016 show that mortgage lending for the month fell by under 1/3; residential transactions in the country fell below 100,000 as did Stamp Duty receipts, as one would expect.

The National Association of Estate Agents in April saw a marked reduction of new buyers (the lowest since March 2014) together with a sharp drop of properties coming to market .

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